Firms fear new tax system is rushed

 
Tim Wallace
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THE PILOT for HM Revenue and Customs’ (HMRC) new real time information (RTI) system was launched last week, but a survey out yesterday shows most firms want its full implementation to be delayed.

RTI is designed to reduce errors in the pay as you earn system of income tax payments when workers change jobs, and HMRC wants to implement it across the board by October 2013 in the hope that it will save employers £300m per year.

However, 61.1 per cent of firms are worried about the processes involved and 44.4 per cent fear financial penalties for innocent mistakes, according to research from human resources firm NorthgateArinso.

“We anticipate that the short time frames and new processes required to administer RTI are going to be a real headache for businesses, as well as potentially costly,” warned Bill Thompson, principal business consultant at NorthgateArinso.

“Under RTI, businesses will need to run monthly or weekly returns rather than one end of year return, which is an enormous change in process and potentially workload.”